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trading. dow down 191 points, and we're going out on the lows of the session for the dow, and we'll see yields on the 10-year we've not seen in about 16 months. that is the first hour. what a day it's been. stick around. a lot more to come. and it is 4:00 on wall street. do you know where your money is? a is -- severe sell-off on wall street. welcome to the "closing bell." we're coming to you from the floor of the new york stock exchange where we're seeing the market swoon in the final minutes. the dow jones industrials average finishing at the lows of the day, and then some, in the final few minutes. down 205 points. the market selling off after ben bernanke said if the central bank could start tapering its economic stimulus measures later this year. look at how we're finishing the day on wall street, and in the last ten minutes of trading, severe selling coming in. the dow finishing down more than
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200 points on the dow. the s&p 500 gives up 23 points, 1.3% lower and the nasdaq down 39 points, better than 1% as well. we all know it. when ben bernanke talks, the federal reserve speaks, the markets listen. bob pisani, what a day it was. i love the way you wrote your blog, taper tantrum. >> reporter: that's the way to explain it. a lot of people felt it would be early for mr. bernanke to explain what he would do, than to explain how the markets would react. let's look at the taper tantrum. the fed came out and said the downside risks to the economies have diminished. that's certainly good news. the economy is improving. then they went on to say, mr. bernanke reiterated, the fed may taper bond purchases at the end of the year and finish by mid-2014. that was a little more flesh on the bones of their plan there. that was the important part of that. stocks and bonds dropped on that. the dow jones industrials average. we have ended at the lows of the day, down about 200 points in the dow. that started dropping -- even
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though we were down before 2:00, the slide accelerated as mr. bernanke began speaking at 2:30 on the press conference. bonds took it on the chin. take a look at the agg. this is the bond etf, the largest one that's out there. that's an aggregate of the total bond market. this is now essentially sitting at a two-year low. let's move on. low inflation, not great necessarily. for gold. gold took it on the chin as well. take a look at gold. gold is also closing right near two-year lows. these are intraday charts. but gold is near a two-year low right now. other commodities dropped as well today, as well as etfs for commodity-producing countries. we've seen volatility here. some of these are emerging market countries. look, 2.5% declines in australia. 3.5% in brazil. volatile recently. russia, 3.7% declines. finally, not surprising when bonds take it on the chin, you know interest rates sensitive stocks will be down more than the overall -- overall markets.
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reits and utilities among the biggest decliners. 5-to-1 declining to advancing stocks today. maria, back to you. >> bob, thank you so much. let's break down today's action and more of what we heard from ben bernanke. joining me is jeff of raymond james and from the trading front line, our own rick santelli and jeff. gentlemen, thanks for joining us. jeff, what's your reaction to the fed's decision? you're in the camp that they won't take any action this year, and you just told us, it could be later on this year. >> yeah, what i heard him say is that it's going to be data-dependent. i think if the numbers start weakening again and the unemployment and numbers start rising, you know, he will probably stay the course. but i think he was pretty clear with what he said. so i'm somewhat surprised by the reaction of the equity markets. >> brian, you think this is appropriate, 206 points lower on the dow after bernanke spoke? >> i think it's a bit of an overreaction, because the reason the markets have been going up
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is not just that interest rates are low, but securities have been very strong. but if there is a substantial part of the market that thinks this is the beginning of the end of a 30-year bull market in bonds, they're going to react, and they're going to react the way they are. >> that's exactly what we're seeing. rick santelli, what was the reaction in chicago? >> you know, forget the fed, forget the statement, forget everything and let's just look at market action. the dollar just started to fly as interest rates moved up. that's logical. and when all of that occurred, commodities got whacked, totally logical. and in the face of rising interest rates, at a time where it's hard to handicap how much is real or memorex in the stock market, it got hit. to me, that makes perfect sense. what's hard to handicap is we could taper, we'll do it if this happens, i continue to think that everything you and bill have said is correct in terms of interpreting the statement. but at the end of the day, i think that there's so much slippage in everything that the fed is saying they're going to
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do, that buying time is the watch word, and i think that makes the markets nervous. >> yeah, it makes the markets nervous, all right, but it's really nothing new. we knew the economy was improving. we're looking at the numbers, the way the federal reserve is looking at the numbers. unemployment has improved a bit. housing has certainly improved. what's wrong with the story, jeff? >> i think the market is overreacting. i agree with your second guest. it's going to be interesting to me to see if they can pile on here the rest of this week. i have been looking for some kind of intermediate top. i thought it would come in july. but we are very close to where i think you're in a place where you could get the first meaningful pullback, and if the markets don't correct themselves and start back up, i'd say in the next day or two, i'd say that pullback is here. >> all right. let me get to gordon, because he's been on the floor watching the activity, finishing up, settling his trades. gordon, what did you see at the end of the day? i know we were going down, down, down, as the market digested that we could, in fact, see the tapering begin in september of this year.
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but at the end of the day, you really had some severe selling, finishing down 206. >> listen, first off, maria, it's fun down here on the floor. starting to pick up some of the volatility intraday, another triple-digit move here. look, today was an interesting day, because initially the reaction to the announcement wasn't that severe. it seemed the more he talked the more it sort of precipitated the interest in the -- you know, that outstanding a move in that context. >> all right. so do you want to buy on the dip, gordon? tell me what this means for tomorrow. >> listen, we're starting to focus on the other major events, maria, coming up. and they're big ones. and at the end of the month, the big one, the russell rebalance,
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and there's a lot in play in that particular event. so, look, there were three things coming up. we've gotten through the first one. it was a little sloppy down here, we'll have to see what the next ones bring. the volume is coming back. we're seeing more interest in the market. it's been interesting down here, and, therefore, more enjoyable for a trader. >> that's good. we've got some action back on the floor of the new york stock exchange. we want to see that. brian, let me ask you. would you buy on this dip? do you want to come in and say, okay, 206 points on the idea that the fed may start tapering down stimulus by year end and the idea that the economy is improving? do you want to find opportunities in this sell-off? >> no, i don't think i would buy here. i wouldn't sell here. but i wouldn't buy. i think the story's going to be with us for a long, long time. it's sort of ironic. the fed has tried to emphasize that they are basically letting off the accelerator, they're not putting on the brakes. no one's listening. they think it's a sea change under way, and despite all of the efforts to clarity, communication, transparency,
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there's a lot of ambiguity, even during the reaction of the market during the press conference. i think there will be more of that. >> you think we're going to keep this guessworking, when will the fed begin to taper, what do the data points say, back and forth? >> i -- that's exactly what i think. >> we did get some more clarity tonight, didn't we, jeff? >> i think you got exactly what the fed said at the last meeting. i think they're going to be data-dependent and whatever the economy does, i think they're going to react to it accordingly. if the economy softens, i think they won't curtail their qe or their purchases. i think if the economy improves, and you get, like, a 300,000 nonfarm print or something like that, i think they will curtail some of their asset purchases. so i think he's plainly said what he's going to do, an it's all data-dependent on the numbers. >> it wasn't exactly what he said the last time. last month in may, he said the committee continues to see downside risks to the economic outlook, boom, period. right now, he said the committee sees the downside risks to the outlook for the economy in the
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labor market as having diminished since the fall. that was the extra comment that basically suggested that things have improved. >> yeah, well, what the ism manufacturing below 50 and some of the other indicators that have come out in the past few weeks, if you lump those all together, it actually suggests there should be another cut or an increase in asset purchases. >> rick santelli, i know you don't want to see that. tell me what the buzz is over there in terms of the sell-off and why bonds and stocks both went down. >> well, i, once again, i think that -- to think that the federal reserve and the bank of japan and the ecb, and there was some headlines at the bank of england is saying they may need more stimulus, came out 15, 20 minutes ago. you know, they're holding a tiger by the tail. i think that traders aren't sure which way to go. but one thing's for sure, the recent buyers of treasuries are throwing them out, and the recent buyers of stocks are throwing them out, and those technical issues override
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everything. nobody strategizes when their position's going against them. at the end of the day, there's one bright spot that i see, and that is that the dollar has rallied superstrong against the yen in the last hour, which means maybe the leverage trade will come back to save the day. but even that in the end really isn't good news, in my opinion. >> it's not good news. so what would you like to see in terms of good news? >> i think good news will be if ben bernanke said qe is going to end in several months, and even though we may not sell off our position, the next chairman of the fed probably will have the mission to contemplate that, and if stocks go down, so be it, because eventually -- and i don't think it would be as many think -- it would find a solid footing and we'd be able to get our market gps back and get back to talking about the economy and all of the fundamentals instead of parsing words and a couple hundred-word statement. >> gordon, how does this play out the next couple of weeks? you think this is a buy on the dip market, or no? >> first off, i hear what rick's saying on some level, but he
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doesn't have it exactly right. the 10-year, these are treasury bonds, have almost 7% move, 6.5% move. look, we were down 1%, 1.5% down here. that's not the same kind of activity at all when you consider equities versus bonds and the safety of the underlying. so we didn't really have the same kind of sense down here of anything more than, you know, he's going to be withdrawing the stimulus and at some point he's got to get out -- does he go from 80 billion to 70 billion, down to 60 billion? look, he's going to fiddle with it. what will he do, wait until it's exactly 6.5% and pull out entirely? he has to massage this thing a little bit. we're seeing that game going now. the fundamentals of the market are a little better than they were when he started the program. so certainly you have to consider this as an opportunity to buy in the dip, the question is when you get in. this is a correction, how severe, that's what you've got to determine. if there's still a risk on the situation here. >> does it feel like the market still wants to go down, knowing what you see, and at the close today, what would be your bet
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for tomorrow morning? >> my bet is they're going to sell them off a little bit more, but they'll find a level. this was not one of these, like, wholesale sell-offs we've seen down here, maria, where they're looking -- you can't find a buyer anywhere. look, they did get -- they wrap rapped them pretty hard late in the day. but again, this wasn't a complete unwind. this activity didn't in any way mimic the activity in the boerps. >> all right. we'll leave it there. gentlemen, thank you very much. great conversation. we'll see you soon. so what now? where do interest rates go next and how to prepare for that. after the break, we'll find out from the bank ceo and the top person at bankrate.com, and what's next for ben bernanke? judging from president obama's bombshell on charlie rose, a big change could be imminent. will that uncertainty hurt the market? that and more coming up, right here, right now, "closing bell." clients are always learning more to make their money do more.
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welcome back. look at this market here. real market swoon here on the heels of the federal reserve details after that two-day meeting. the fed basically suggesting that the tapering off the qe could begin later this year. if economic prospects continue
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as they have been, which have been improving. with that statement, the market sold off, better than 200 points, and we had some severe selling right in the last 15 minutes of trading. so how soon will the fed scale back that stimulus? it seems ben bernanke answered the question today. here is what he said specifically. if the incoming data are broadly consistent with the forecast, the committee currently anticipates that it would be appropriate to moderate the monthly pace of purchases later this year. and if the subsequent data remain broadly aligned with our current expectations for the economy, we would continue to reduce the pace of purchases in measured steps through the first half of next year, ending purchases around midyear. meaning next year this time, we're out of quantitative easing. the fed is out of the bond-buying business about a year from now. let's get reaction from greg mcbride and scott shay, chairman of signature bank, which works primarily with small and medium-sized businesses.
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gentlemen, good to have you on the program. >> thank you so much. >> you said the economic headwinds that remain in the way of the fed tapering, when do you think it begins? >> a lot of that is -- bernanke stressed this, it's data-dependent. the timetable he laid out is more of a perfect scenario. let's look at the past few years. the middle third of the year, we've hit a soft patch. each of the last three years, and it could happen this year. the sequestration kicking in, second-quarter growth is expected to be much lower than the first quarter. household income is stagnant, and as a result, top-line revenue growth still pretty tough to come by. i think you put all of that together, it gives the fed plenty of cover to hold off, maintain the pace for now, and i wouldn't be surprised if the timetable gets pushed back if the economy does hit a soft patch. >> huh, so you're not buying it that we're necessarily going to see quantitative easing taper down beginning later this year? >> i believe it when i see it, simply because we've had a lot of false economic dons these past few years. if we see that again, once again, the timetable won't pan
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out. >> scott, let's say the timetable is what bernanke orchestrated for us. your bank works with small and medium-sized businesses. can you character uz for us what the impact would be to the businesses? >> i think having a set schedule or the more we can define the schedule is a positive for our business, the businesses that we bank. >> they want certainty. >> they want certainty. the notion that the fed has two hands on the dial and can change really that uncertainty isn't helpful, and we're seeing, i think, a view that tapering -- that's okay. just tell us what's coming. >> right. >> and let us move on. >> they're sitting on the cash. they don't know about regulation. they don't know about fees and litigation costs, and they certainly don't know what happens with the fed. so all of that has these small and medium businesses, i guess, reluctant or unwilling to hire or put money to work. >> well, i think the fed has done all it can for medium and small businesses. i think what needs to happen to get growth going -- because
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small and medium-sized businesses create 60% of the jobs. they're very important to the recovery. what's really needed are simplifying corporate taxation, corporate tax reform, regulatory issues. the legislate -- the congress and president have been on the sidelines on all of those issues for the last four years. >> right. which is one of the issues, of course, as i mentioned in terms of confidence. so, craig, what now? if you are looking at the interest rate scenario -- i mean, we know the 10-year has been moving up, you know, 2.2%. i personally don't think that's enough of a number to actually want to take money out of stocks and put it in bonds. but are you expecting rates to continue higher from here? >> no, i'm really not. i don't think ben bernanke is either. one of the things he said today in the press conference was he was surprised long-term rates had jumped up as much as he had with the revelation he had in may that the tapering could begin in the next few meetings. what did he do today? he pushed that timetable back, as i see it, look, under this perfect economic scenario, it could start later this year, and
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yet what do we see, the 10-year yield jumps another 10, 15 basis points. so i'm surprised we've seen it considering the fact that, look, the fed is not exactly said that we're on the cusp of doing it and the fact that there are so many economic headwinds. >> scott, there are some businesses that are actually going to be beneficiaries of rates as they move higher. >> i would say a lot of businesses will be. and even more so, the lower rates have actually advantaged the larger companies versus small and medium-sized companies, because the banks have -- the big banks in particular -- have been sort of a congested credit transmission process. so to a certain degree, higher rates have an equalizing impact. and i think provide resources to the regional banks. it's a good environment, steeply slope yield coverage great for regional banks. so that'll provide further benefit to providers of credit to small and medium sized businesses. >> real quick on the regulatory environment. i was having a conversation about this yesterday with somebody. given the fees and the new
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regulatory, you know, higher regulations out there, do small and midcap banks get the short end of the stick there? because when you look at a larger bank that has a much higher market value than a smaller and midcap bank, they're facing the same fees, right? one with more assets and a higher market cap can handle it much better, right? >> oh, there's no doubt that the current regulatory environment is tilted so far in the direction of the big banks. because they can have floors of staffs just dealing with these regulations. >> right. >> whereas, when you're talking to folks lending to small and medium-sized businesses, we're much smaller and we have to deal with those issues with less forces. same issues, fewer people to do it, and less dollars to lend to the job creators of the country. >> yeah, that's very curious to me. anyway, gentlemen, thank you very much. great conversation. we appreciate it. we'll see you soon, greg mcbride, scott shay joining us today. our special coverage of the policy meeting and the marks continues. lynn hubbard, former chairman, current dean of the columbia
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business school is up next. what does he think the president meant or did he make a mistake by signaling this week to signal ben bernanke was on his way out? we'll ask him about that. and don't miss my interview tomorrow with house speaker john boehner. we'll talk about government surveillance, debt ceiling, nsa leak, immigration, a lot more, just to name a few. we'll also talk about bernanke. back in a moment. ♪ [ engine revs ] ♪ [ male announcer ] just when you thought you had experienced performance,
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the ones getting involved and staying engaged. they're not afraid to question the path they're on. because the one question they never want to ask is "how did i end up here?" i started schwab for those people. people who want to take ownership of their investments, like they do in every other aspect of their lives. welcome back. bernanke speak, stocks react, and they react badly.
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over to you, josh. >> leaders and laggers in today's session. adobe the clear winner. they report better than expected adjusted quarterly profit. jeffries, jmp, fbr all raising price targets. fedex climbing. the bellwether reports higher than expected quarterly profit. looking ahead, fedex expects per share adjusted earnings that missed consensus. still, that stock ening higher in today's trade. as for laggers, analysts downgrade sprint to neutral, recommending investors take profit, as attention shifts from m&a back to fundamentals. they lowered the price target to 7.65. two tech names, one is blackberry. analysts at bernstein not fans. they downgrade this one to underperform, talking about very weak bb-10 traction. price target 10 bucks, and nvidia, might have new business with apple and other mobile device makers, and finally
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ending on men's warehouse, the founder who founded the company 40 years ago, in a statement saying he had concerns about the direction the company was heading in and the board, he said, chose to silence him. maria, back to you. >> all right, josh, thank you so much. ben bernanke may have given the markets an answer for when the tapering will finally begin, and even end. but he gave no indication about his own future, particularly on the heels of president obama all but showing him the door on monday night. remember this? >> well, i think ben bernanke's done an outstanding job. ben bernanke's a little bit like bob muller, the head of the fbi. >> yes. >> where he's already stayed a lot longer than he wanted or he was supposed to. >> i don't have anything for you in my personal plans. >> and joining me right now is glenn hubbard, dean of the columbia business school, former chairman of the president's council of economic advisers under president reagan. he's the author of the new book "balance, the economics of great powers from ancient rome to modern america." welcome, sir. good to see you. >> thanks, my pleasure.
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>> so president bush appointed chairman bernanke. what did you make of president obama and his comments this week in that interview? >> what's quite curious -- obviously, this is a decision for the president to make, but to make the statement before the fmoc meeting is somewhat odd. >> odd or, look, i want him out? >> well, i think this is the president's call. there is a list of names the president is looking at, and people have talked about, and i think he'll probably make a decision this fall. and i doubt it will be ben bernanke. >> well, i think that's pretty clear. he said he stayed longer than he was supposed to. who do you think is the best candidate to replace bernanke then? >> i think there are a number of choices the president has that could be very good fed chairman. the real issue is more the policy direction for the fed, and i think chairman bernanke and the fed have been on a path that the new chairman will have to assess. >> i mean, you know, by all accounts, people look at the federal reserve as being the one steady sort of support to the economy. and on and on again, bernanke seems to suggest that the white
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house and congress are nowhere in terms of fiscal policy. i think a lot of people would agree with that. is that, do you think, sort of unnerving? >> i think -- well, i think it is unnerving. the chairman's right. the president and the congress are nowhere. we need a better fiscal policy than the government has. having said that, the fed can't really carry this by itself. the fed is not going to be able to lower the unemployment rate without better fiscal policy. >> so give me your thoughts on -- first, let me get your thoughts, backtrack a bit, and get your thoughts on the fed decision, more specifically the comments on the economy. because this market certainly had a real sharp reaction. >> well, i think the economy is in what i would describe as a fairly tepid recovery. i think the fed's change in statement indicates perhaps a little more optimism than that. the caution is we've had several of these episodes of thinking things could completely turn the corner, and they haven't. >> well, you said recently that you would give bernanke an "a,"
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an "a minus," and what do you think he's doing right? >> i think the chairman did a very good job in the aftermath of the crisis. the fed was a steady organization when the government, frankly, was not. i think there is little argument in my mind that additional quantitative eating will have a huge, positive effect on the economy. i think the better thing is to talk more about future policy and to get the congress to act. >> so bernanke said that the fed would not begin to likely reduce the bond-buying program until later this year. do you think that's an attainable timeline target? do you agree with that target? >> i think it depends on what you think the outlook is. based on the outlook that the chairman talked about, i think that timetable is reasonable. i think the there are downside risks to that outlook, in which case it may slip up. i think it's clear that chairman bernanke wants to keep the accommodation, and any candidate from the president is going to, if anything, be more accommodative than bernanke. >> so you think -- and that's something that my last guest
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said as well, greg mcbride from bankrate.com, basically said this economy is still an anemic grower, and we may well see the timeline pushed out and the tapers doesn't end. that puts us right back where we were yesterday, no clarity in terms of what's happening, dependent on the data. >> exactly. and that's what's unsettling a bit in markets. better fiscal policy would help, and once we know the identity of the chairman, it will help. >> real quick, are your students getting jobs? >> an active job market for mbas. the job market for the best students is always excellent. >> great. thank you. glenn hubbard joining us. meanwhile, other news out of washington besides the federal reserve. how outrageous is this? the internal revenue service is about to dole out $70 million in bonuses despite a government directive not to do so, because of union pressure. iowa senator chuck grassley flagged this, and he's up in arms. he's coming up next to talk about it. and be sure to watch my
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exclusive interview with house speaker john boehner, tomorrow in d.c. we'll talk irs shenanigans, government surveillance leak, debt ceiling, a lot more. join us tomorrow 4:00 p.m. eastern here on "closing bell." otherworldly things. but there are some things i've never seen before. this ge jet engine can understand 5,000 data samples per second. which is good for business. because planes use less fuel, spend less time on the ground and more time in the air. suddenly, faraway places don't seem so...far away. ♪ with fidelity's options platform, we've completely integrated
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as if the irs didn't have enough problems, a new $70 million controversy is emerging that has some people up in arms. ayman explains what's going on. >> reporter: senator grassley said he has discovered that the irs is expected to pay $70 million in bonus, despite a sequestration order in place encouraging federal agencies to hold off on discretionary payments to their employees in light of the budget cutbacks at the federal level. the irs, maria, may not ultimately have that much choice in this situation. here's the statement that we got from the irs earlier today saying omb guidance directs that any agent -- that agencies should not pay discretionary monetary awards at this time unless legally required. irs is under a legal obligation to comply with its collective bargaining agreement, which specifies the terms by which awards are paid to bargaining unit employees. they also told us that in accordance with omb guidance,
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the irs is actively engaged with its union in recognition of the current budgetary constraints. so the irs signaling there in that statement, maria, there might be wiggle room in negotiations with the union, but also saying they are legally required, apparently, to pay these benefits based on their bargaining agreement with the unions. so senator chuck grassley has discovered this, and he said he doesn't approve of this one bit in light of all of the budget tightening going on across the federal government, maria. >> all right. thank you so much. joining me from capitol hill, a first on cnbc interview, republican senator from iowa, charles grassley. senator, good to have you on the program. thank you so much for joining us. >> good to be with you, thank you. >> how did you find out about the soon-to-be-paid bonuses to union irs employees? >> we got inside information and we followed up, and it's accurate. when you figure that the omb put out this order that these bonuses shouldn't be given because of sequestration, and then you wonder if the president
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would weigh in now, it would really bring this bonus pain to an end, because we can't afford $70 million, particularly because of the national debt, but also because cb -- or the irs is always coming to us and saying, "we need more money for this or that." well, they need to spend this $70 million on something more useful than bonuses at a time when the omb says that bonuses shouldn't be given. >> and are these bonuses in cash, or does this also include the benefits? they've got a pretty healthy benefit package as well, right? >> well, i don't know the answer to your question, but i assume it's in cash payment, because their fringe benefits are healthy, as you say. and i agree with you. but they're set separately from this, as far as i could tell. >> senator, let me ask you this, because the irs is saying that it is under legal obligation in
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its collective bargaining agreement to pay these bonuses, to pay out $70 million in bonuses. even if they wanted to stop them, can they really do so legally? >> my judgment is that they can, and that they should. and if they have to fight for it, you know, if they're sued or something, well, sue me would be the attitude i'd take. >> what do you -- what would you like to see happen? here we are in the middle of a scandal of, you know, the irs targeting certain groups that they don't agree with, and now this. >> i want the director of the internal revenue service to say we aren't going to do it and cite the omb director. and if that doesn't work, i want the president to step in, because, after all, the president is the chief executive of that branch of government. he's president of the united states. he's the manager. he's the person that directs omb to make these statements, and he
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should back them up. >> have you discussed it with the president yet? >> no, i haven't. probably won't have -- probably won't have a chance. >> so you're not going to discuss it? i mean, this is your way of discussing it, publicly? >> well, listen, we -- well, this is one way of doing it. but we're sending a letter to irs as well. >> yeah, but, sir, all government agencies took cuts as a result of sequestration, right, including the irs, and then they started furloughing employees. so what does it say about the priorities at the agency? >> the priorities of the agency are surely not the taxpayers, when $70 million is being wasted this way. and you can understand that this is an organization that's already not well managed, or you wouldn't have all of these disclosures about these nonprofit organizations not getting approval. >> right. i mean, do we have any evidence, in fact, that -- i mean, there's a great firestorm that the irs is targeting the conservative
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groups, targeting of groups that they don't agree with in their politics. is there any evidence that the bonuses are going to the employees who may have been involved in that scandal? >> you know, i don't have any information on that whatsoever. there's no way i can answer it. but $70 million is going to go a long ways for bonuses. so who knows who it's going to cover? >> where are we on that scandal? there have been calls for an independent commission to come in and investigate what exactly went on and if, in fact, this is a lot bigger. a lot of people think it's much bigger, and it's not just conservative groups they targeted people that they didn't agree with. >> well, i agree with you. and at this point, i'm not going to propose going along with a commission. a commission may be the final answer, but i want the congressional oversight to continue until we get this information out, because everything that goes on in congress in these hearings is public knowledge. and who knows when you get a special prosecutor or you get a commission set up, maybe it
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won't be public like a -- a -- the -- the legislative committee is, you know. >> all right, senator, good to have you on the program. thanks very much. we appreciate it. >> thank you. >> we'll see you soon. senator charles grassley joining us. tomorrow, don't miss my exclusive interview with the speaker of the house, john boehner, talking about the irs scandal to the state of the economy, to whether ben bernanke should get another term or not. join us tomorrow. and back over to josh lipton. >> maria, some headlines dropping on that tom ward is resigning. james bennett has been named ceo of the skp, saying in a statement it reflects the judgment that despite the contributions, the new leadership is in the best interest of the company and its shareholders at this time. the stock popping about 3.7%
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here in the after hours. maria, back to you. >> all right, josh, thank you so much. making money off the market's recent volatility. find out how to use recent swings in the fear index to build greater returns for your retirement fund. that's coming next. and the top money pros on what could move your money tomorrow. [ male announcer] surprise -- you're having triplets. [ babies crying ] surprise -- your house was built on an ancient burial ground. [ ghosts moaning ] surprise -- your car needs a new transmission. [ coyote howls ] how about no more surprises? now you can get all the online trading tools you need without any surprise fees. ♪ it's not rocket science. it's just common sense. from td ameritrade.
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welcome back. the markets have been on a wild ride recently. volatility has spiked 35% just over the last month. in fact, this was the seventh consecutive triple-digit move for the dow jones industrials, up or down. bob pisani breaking it down, and telling us how to protect our nest eggs. >> reporter: if all of the volatility is getting to people -- and i'm getting e-mails indicating it is -- you can use etfs. i've been talking about shorting stocks, and i don't like leveraging, as they can be expensive. they reset every day. huh-uh. better alternative, if you really can't take it, reduce your exposure to equity, duh, or alternatively, if you insist on staying in stocks, go to low-volatility etfs, that's splv, investing largely in consumer-type stocks that have much lower volatility than the rest of the market.
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there's an option. as for bond funds, and this is where i get the questions, three choices. it's simple. you can reduce your bond exposu exposure, go to cash, second, shorten the duration, or third, go to managed bond funds. the trend right now is i see many professionals telling people to go shorter durations. that's the story. for everyone who insists on insisting in barclays high yield fund, switch out, and go to the short-term. both have 6% yields, but the perception is the short-term fund has much less risk in the long run. now, the last choice is just go active. there's a reasonable case for saying, why should i manage my bond exposure right now? i don't know what to do, why not trust bill gross, for example? here's my one caveat. active management isn't helping much. bill gross' total return fund down 4.1%. since may 1st. the total bond fund? that's the index fund, down 3.1%. get that? all right. you want to learn more how to build a retirement portfolio, check out our website,
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retirement.cnbc.com, portfolio recommendations for 30-year-olds, 40-year-olds, 50-year-olds, diversify and get educated. i love bill gross. who doesn't love bill gross. you see how hard it is? the best guy in the world is having trouble managing. >> great advice, bob. thank you so much. bob pisani. meanwhile, ben bernanke has spoken and the marks didn't like what they heard. we have 30 seconds on the clock for our next guest to tell us what we should be watching for. jim harold is with me, jordan culley and cliff davis. jim, you're up first, 30 seconds on the clock, what do you want to be prepared for? >> hi, maria. for tomorrow, following today's fmoc meeting, we're watching the u.s. 10-year note very closely. yields have gone up nearly 50% in just under two months. this could have an impact on the housing market, which could derail the whole economic recovery. in our managed etf, we're watching the u.s. homebuilders index as our canary in the coal
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mine for signs that this whole rally might be coming to an end, and finally, maria, happy 21st anniversary to my wife. >> oh, we'll be watching. thank you. great. jordan, you're up. 30 seconds on the clock. what do you want to be prepared for tomorrow? >> obviously, the market didn't like what came out from bernanke today. but we actually think this is just a short-term correction and ongoing uptrend. because if you look at the longer-term perspective here, have people liquidated their stocks in significant ams prior to this actual pullback today? and there isn't anything that shows us that that has happened. so we actually think this is just a temporary correction that's just going to work itself out. but the thing that we're actually nervous about is some of the action we're seeing in the emerging mark, such as hong kong, china, and australia, where you're seeing a lot of deterioration and really heavy selling coming in. >> you're right. so do you think emerging markets come back? i mean, that's been -- that's been the story, that we're not talking enough about. >> right, right. well, actually, there's been so much deterioration that we think this could be more than a
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temporary correction, something that will be multimonth or even a bear market. >> yeah. we'll be watching that. cliff, you're up. what will you be watching tomorrow? 30 seconds on the clock. >> with the fed signaling qe tapering, investors need to prepare for sell-off. earnings season around the corner. defensive names will start outperforming the rest of the market. investors need to start preparing for a lot more volatility in the markets, a lot less liquidity, and really just chop your trading sessions going into the summer months. investors that i'm in touch with are buying vix puts, vix calls and s&p puts and looking to protect the gain, protect the profits they've made, and look at their portfolio and say how do i best protect myself. caution is key. >> we'll leave it there. gentlemen, thank you very much. we'll keep watching. appreciate it. pumping up profits in style. up next, the ceo of ult ultra high-end shoemaker manolo ambulan
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>> welcome back. for decades few people associated glitz and glamor with the bottom of their closet but the eye popping prices and sexy style of man oil oh, blanic
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shoes changed all that. is the shoe maker poised to kick up a storm. george malcolm is president and ceo of manolo blahnik. good to have you on the program. >> nice to be here. >> i am a big fan. we are thrilled to have you. >> we love you fans. >> what is the state of the luxury market today? >> i think it's rebounded and our business right now is very, very strong. i think fashion has changed and i think part of that is that women are sort of tired of heavier platform shoe and manolo has stood for the sleek sexy timeless shoe. when people are feeling more comfortable outstanding money, they look to a product that really will not age with fashion. basically something more timeless that will go on years and years in your closet. >> it's much more feminine. >> ultra attempt anyone. >> you told me during the break
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which i found interesting, this fuchsia shoe, suede is the hottest shoe. why is that. >> it's called the bb pump named for bridget bardeau. the way that shoe fits and the way she walks, it elongates her leg, accent waits the prettiest part of her cancel. the way bridge it used to walk, sexy, feminine. >> where is the biggest business coming from right now? give us the geographies? >> america with the economy stronger than in europe and with europe still struggling along and asia and china struggling worse than we are, america is the strongest market right now. >> are you seeing real weakness persist in europe? >> yes. >> everybody says that, every city. >> we hope and look at it month
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by month. people haven't lost sight of the fact that it's scary there. >> asia has a big potential. >> yes. we hope for for china. it hasn't happened as fast as we want it to. right now american ladies are helping us stay alive. >> we are seeing a recovery and we heard that from ben bernanke today. what are the prices of these shoes. people say i love manolo blan iks and it's not in my price range. what makes this shoe special? >> i brought this shoe for three reasons. eats $595. it comes in an array of colors. that's $595. the blue satin shoe is from sex and the city which was sarah jessica's wedding shoe in the movie. that's about $1,000. the shoe in the middle is louisiana alligator and that's
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$5500. >> because it's alligator. >> exactly. >> good to have you on the program and to see the hot products. do you think colors are the hot thing? >> colors are neutrals. with anything you bring to it, prints are big again. that shoe with prints is fantastic. >> i got the scoop from the leader of it all, president and ceo of man oil la blanic. up next why the market should stop looking at what ben bernanke is doing and focus on why he's doing it. texas gofr rick perry will co-host tomorrow on the program. speaker of the house john boehner will come to you tomorrow from d.c. back in a moment.
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part of our goal to inspire more than three million people to rediscover the joy of being active this summer. see the difference all of us can make... together. >> finally today my observation on what we herd from the fed and chairman ben bernanke and the ensuing 200 point selloff. my question is what is the worry? let's not loose sights of the important fact. if the fed skaels back and exit it means the economy is getting better. let's not forget the goal. if the incoming data are broadly
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consistent with our forecast the committee anticipates it would be appropriate to moderate the monthly pace of purchases late are this year. with that, the market sold off better than 200 points by the close. are we missing something here? the whole intention of the stimulus from the fed was to help the economy improve since congress was too dysfunctional to take meaningful measures. that's exactly what we're seeing. another quote from ben bernanke shows that. the committee sees down side risk to the labor market as having diminished to the fall. compare to that the may statement that said the committee continues to see downside risk. what am i missing here? we knew the fed couldn't buy $85 billion a month into infinity. better economic story. my observation on all of this is today was a positive day despite a 206 point decline for the dow,
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all ben bernanke is saying is that our economy is out of critical care and needs to start walking under its own power. with all the cash on side lines i still see a day like today as a buy on the dip. that's been the mentality until now. we shall see if our economy is getting better. that will do it for closing bell. thanks for joining me. i'll see you tomorrow. fast money begins right now. >> life in the nasdaq market site in new york city i'm melissa lee. taper games. the market having its worst fed day since september 2011, the dow dropping 206 points and the ten year yield surging to a one year high. also suggests a possible taper

tv
Closing Bell With Maria Bartiromo
CNBC June 19, 2013 4:00pm-5:01pm EDT

News/Business. Maria Bartiromo. Analysis of the day's winners and losers in the stock market. New.

TOPIC FREQUENCY Ben Bernanke 19, Us 15, Irs 6, John Boehner 4, The Irs 4, America 4, Greg Mcbride 3, Gordon 3, Bob Pisani 3, U.s. 3, China 3, Europe 3, Asia 2, S&p 2, Honda 2, Manolo 2, Iowa 2, Scott 2, Australia 2, Mr. Bernanke 2
Network CNBC
Duration 01:01:00
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